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Potential assignment violations by clinical laboratories

It has come to the attention of First Coast by CMS and other Medicare stakeholders that some laboratories are charging patients upfront to perform services. This would not be appropriate as, typically, beneficiaries are not financially responsible for lab services, even if the patient has other medical insurance involved.

As a reminder, providers of laboratory services should be aware of the following Medicare regulations:

  • By law, you must submit Part B claims for all Medicare beneficiaries.
  • Additionally, a provider must accept assignment for laboratory tests paid on the laboratory fee schedule. Otherwise, a Part B Medicare administrative contractor (MAC) cannot make payment for laboratory tests. Furthermore, no payment may be made for clinical diagnostic laboratory tests furnished by a physician or medical group unless the physician or medical group accepts assignment or claims payment under the indirect payment procedure for the laboratory services.
  • For all clinical laboratory tests, specimen collection fees or travel allowance related to laboratory tests performed by a physician, laboratory, or other entity paid on assigned basis, neither the annual deductible nor the 20% coinsurance apply; the MAC will pay the lesser of the actual charge or 100% of the clinical laboratory fee schedule.
    • By law, the basic allowable charges for a beneficiary are the remaining deductible and 20% of the customary (or reasonable) charges more than the deductible. If the provider collects any monies from the beneficiary, the provider must inform the MAC of any amounts collected from them or from other persons on his or her behalf by completing Item 29 of the CMS-1500 claim form (or electronic equivalent).
    • Note: Please review "When not to show patient paid amounts on claims" article before collecting payments from patients.

Potential penalties for assignment violations

Providers who knowingly and willfully bill patients on an unassigned basis may be subject to sanctions, civil money penalties (up to $2,000 per violation), and exclusion from the Medicare program for a period of up to five years imposed. 

Beneficiaries are encouraged to report potential assignment violations to 1-800-MEDICARE.

 

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